§ 45-12-2 Maximum aggregate indebtedness. – Except as provided in § 45-12-11, no city or town shall, without special statutory authority, incur any debt for money hired which would increase its aggregate indebtedness not excepted by law from the provisions of this section to an amount greater than three percent (3%) of the taxable property of the city or town, but the amount of any borrowing in anticipation of taxes which is authorized or validated by § 45-12-4, and the amount of any sinking fund, shall be deducted in computing that indebtedness. Any city or town may, without special statutory authority, hire money to an aggregate amount, as with the other indebtedness of the city or town not deductible under the foregoing provisions, which shall not exceed the limitation contained in this section.
§ 45-12-11 Authority for issuance of indebtedness excess. – The state director of administration may, upon petition by the city or town council, authorize the city or town to incur indebtedness in excess of the limit of three percent (3%) of the taxable property of the town imposed by § 45-12-2 whenever the director determines that the sum appropriated by any city or town or the funds available are insufficient to pay the necessary expenses of the city or town. For this purpose the state director of administration may require any information concerning the financial condition of the city or town that the director may deem necessary for the proper exercise of that authority.
View the full text of Chapter 45-12, Indebtedness of Towns and Cities.